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Aflac Inc – ‘10-Q’ for 9/30/95

As of: Thursday, 11/9/95 · For: 9/30/95 · Accession #: 4977-95-23 · File #: 1-07434

  As Of                Filer                Filing    For·On·As Docs:Size

11/09/95  Aflac Inc                         10-Q        9/30/95    4:133K

Quarterly Report — Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        3rd Quarter Form 10-Q                                 26    101K 
 2: EX-10       Amended Stock Option Plan                             13     47K 
 3: EX-10.1     Employment Agreement Psa                              13     56K 
 4: EX-27       Article 7 FDS for 10-Q                                 2±     8K

10-Q — 3rd Quarter Form 10-Q
Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) AFLAC Japan Aflac U.S Exhibits and Reports on Form 8-K Independent Auditors' Report Legal Proceedings Management's Discussion and Analysis of Financial Condition and Results of Operations Review by Independent Certified Public Accountants
1	1st Page - Filing Submission
11	Review by Independent Certified Public Accountants
12	Independent Auditors' Report
13	Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
15	AFLAC Japan
19	Aflac U.S
24	Item 1. Legal Proceedings
"	Item 6. Exhibits and Reports on Form 8-K

10-Q 1st Page of 26 TOC ↑Top Previous Next ↓Bottom Just 1st
 
SECURITIES AND EXCHANGE COMMISSION    
WASHINGTON, D.C.  20549   

FORM 10-Q     

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT of 1934  

For the quarter ended September 30, 1995  
Commission File No. 1-7434  

AFLAC INCORPORATED    
------------------------------------------------------  
(Exact name of Registrant as specified in its charter)  

GEORGIA                                            58-1167100 
-------------------------------                        -------------------      
(State or other jurisdiction of                           (I.R.S. Employer      
incorporation or organization)                         Identification No.)      

    1932 WYNNTON ROAD, COLUMBUS, GEORGIA 31999
     -----------------------------------------------------
     (Address of principal executive offices and zip code)

 Registrant's telephone number, including area code (706) 323-3431

Indicate by check mark whether the registrant (1) has filed all reports         
required to be filed by Section 13 or 15(d) of the Securities Exchange Act      
of 1934 during the preceding 12 months (or for such shorter period that the     
registrant was required to file such reports), and (2) has been subject to      
such filing requirements for the past 90 days.                                  
Yes   X   .  No       .                                                         
------      ------                                                      

Indicate the number of shares outstanding of each of the issuer's classes of    
common stock, as of the latest practicable date.                                

   Class                                            November 3, 1995
----------------------------                             ------------------     
Common Stock, $.10 Par Value                              94,752,640 shares     

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   AFLAC INCORPORATED AND SUBSIDIARIES

   INDEX

                                                                Page
                                                                 No.
                                                                ----
Part I.  Financial Information:                                                 

Item 1.  Financial Statements                                         
Consolidated Balance Sheets -                                     
    September 30, 1995, and December 31, 1994..............        1

Consolidated Statements of Earnings -                             
Three Months Ended September 30, 1995 and 1994                
   Nine Months Ended September 30, 1995 and 1994...........        3

Consolidated Statements of Shareholders' Equity -                 
   Nine Months Ended September 30, 1995 and 1994...........        4

Consolidated Statements of Cash Flows -                           
   Nine Months Ended September 30, 1995 and 1994...........        5

 Notes to Consolidated Financial Statements................        7

Review by Independent Certified Public                            
   Accountants.............................................       10

 Independent Auditors' Report..............................       11

Item 2.  Management's Discussion and Analysis of                      
 Financial Condition and Results of Operations.............       12

Part II.  Other Information:                                                    

Item 1.  Legal Proceedings.................................       24

Item 6.  Exhibits and Reports on Form 8-K..................       24

Items other than those listed above are omitted because they are not            
required or are not applicable.                                                 

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Part I.  Financial Information

 AFLAC INCORPORATED AND SUBSIDIARIES
 Consolidated Balance Sheets
(In thousands - Unaudited)

                                           September 30,  December 31,
                                           1995           1994
                                           ------------   ------------
ASSETS                                                                          
Investments:                                                                    
Securities available for sale, at fair value:                             
Fixed maturities                                                    
(amortized cost, $16,593,479 in                               
   1995 and $14,709,820 in 1994)         $ 19,385,647   $ 15,530,694
Equity securities                                                   
(cost, $74,199 in 1995 and                                    
   $71,585 in 1994)                            99,535         84,373
Mortgage loans on real estate                     21,459         25,104   
Other long-term investments                        4,865          5,038   
Short-term investments                           497,459        330,916   
                                          -------------  -------------
Total investments                             20,008,965     15,976,125   

Cash                                                 18,060         17,643      
Receivables, primarily premiums                     325,209        303,748      
Accrued investment income                           210,409        220,757      
Deferred policy acquisition costs                 2,596,078      2,402,869      
Property and equipment, net                         572,476        580,247      
Securities held as collateral for                                               
loaned securities                                980,940        556,937   
Intangible assets, net                              106,665        109,865      
Other                                               121,959        118,888      
                                          -------------  -------------
Total assets                                $ 24,940,761   $ 20,287,079   
                                          =============  =============

See accompanying Notes to Consolidated Financial Statements.                    

(continued)                                                                     

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AFLAC INCORPORATED AND SUBSIDIARIES         
Consolidated Balance Sheets (continued)         
(In thousands, except for per-share amounts - Unaudited)        

                                          September 30,   December 31,
                                           1995           1994
                                          -------------  -------------
LIABILITIES AND SHAREHOLDERS' EQUITY:                                           
Liabilities:                                                                    
Policy liabilities:                                                       
Future policy benefits                   $ 18,130,146   $ 14,586,171
Unpaid policy claims                        1,055,956        929,350
Unearned premiums                             333,996        339,514
Other policyholders' funds                    172,610        151,572
                                          -------------  -------------
Total policy liabilities                   19,692,708     16,006,607
Notes payable                                    352,437        184,901   
Income taxes, primarily deferred               1,444,204      1,392,441   
Payable for return of collateral on                                       
loaned securities                             980,940        556,937
Payables for security transactions                25,048         46,371   
Other                                            385,242        348,055   
                                          -------------  -------------
Total liabilities                             22,880,579     18,535,312   
                                          -------------  -------------
Shareholders' equity:                                                           
Common stock of $.10 par value.  Authorized                               
175,000; issued 104,208 in 1995 and                                 
104,000 in 1994                                10,421         10,400
Additional paid-in capital                       201,398        198,099   
Unrealized foreign currency                                               
translation gains                             213,306        174,091
Unrealized gains on securities                                            
available for sale                            471,501        228,844
Retained earnings                              1,506,617      1,277,487   
Treasury stock                                  (341,949)      (135,776)  
Notes receivable for stock purchases              (1,112)        (1,378)  
                                          -------------  -------------
Total shareholders' equity                     2,060,182      1,751,767   
                                          -------------  -------------
Total liabilities and shareholders' equity  $ 24,940,761   $ 20,287,079   
                                          =============  =============
Shareholders' equity per share                 $      21.72   $      17.58      
                                          =============  =============
Shares outstanding at end of period                  94,835         99,636      
                                          =============  =============

See accompanying Notes to Consolidated Financial Statements.                    

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                                              AFLAC INCORPORATED AND SUBSIDIARIES                                       
                                              Consolidated Statements of Earnings                                       

 (In thousands, except for                           Three Months Ended September 30,    Nine Months Ended September 30,
 per-share amounts - Unaudited)                     --------------------------------    ------------------------------- 
                                                        1995                1994            1995               1994     
Revenues:                                           ------------        ------------    ------------       ------------ 
                                                                                                                        
  Premiums, principally supplemental                                                                                    
   health insurance                                 $ 1,531,396         $ 1,362,309     $ 4,617,262        $ 3,796,341  
  Net investment income                                 259,125             217,298         772,168            612,547  
  Realized investment gains (losses)                        (64)               (248)             85               (345) 
  Other income                                           21,261              22,152          68,650             66,153  
                                                    ------------        ------------    ------------       ------------ 
        Total revenues                                1,811,718           1,601,511       5,458,165          4,474,696  
                                                    ------------        ------------    ------------       ------------ 
Benefits and expenses:                                                                                                  
  Benefits and claims                                 1,270,332           1,119,696       3,830,392          3,109,235  
  Acquisition and operating expenses:                                                                                   
    Amortization of deferred policy                                                                                     
     acquisition costs                                   41,016              41,138         123,849            107,762  
    Insurance commissions                               202,562             181,731         609,836            503,834  
    Insurance expenses                                  109,856              91,916         321,804            276,939  
    Interest expense                                      4,086               3,794          12,096              9,918  
    Capitalized interest on building construction             -                   -               -             (2,419) 
    Other operating expenses                             32,135              33,724         102,591             97,413  
                                                    ------------       ------------    ------------        ------------ 
        Total acquisition and                                                                                           
        operating expenses                              389,655             352,303       1,170,176            993,447  
                                                    ------------       ------------    ------------        ------------ 
        Total benefits and expenses                   1,659,987           1,471,999       5,000,568          4,102,682  
                                                    ------------       ------------    ------------        ------------ 
        Earnings before income taxes                    151,731             129,512         457,597            372,014  

Income taxes                                             63,771              53,453         191,848            156,620  
                                                    ------------       ------------    ------------        ------------ 
        Net earnings                                $    87,960        $     76,059    $    265,749        $   215,394  
                                                    ============       ============    ============        ============ 
        Net earnings per share                      $       .89        $        .74    $       2.64        $      2.08  
                                                    ============       ============    ============        ============ 
Shares used in computing earnings per share              98,436             102,812         100,484            103,513  
                                                    ============       ============    ============        ============ 
Cash dividends per share                            $       .13        $       .115    $       .375        $       .33  
                                                    ============       ============    ============        ============ 
See accompanying Notes to Consolidated Financial Statements.                                                            
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AFLAC INCORPORATED AND SUBSIDIARIES         
Consolidated Statements of Shareholders' Equity         
(In thousands - Unaudited)          
                                         Nine Months Ended September 30,
                                            1995            1994
Common stock:                                --------------  -------------  
Balance at beginning of year             $        10,400 $      10,371
Exercise of stock options                             21            19
                                          --------------  ------------
Balance at end of period                          10,421        10,390
                                          --------------  ------------
Additional paid-in capital:                                                 
Balance at beginning of year                     198,099       195,730
Exercise of stock options                          2,313         1,319
Gain on treasury stock reissued                      986           118
                                          --------------  ------------
Balance at end of period                         201,398       197,167
                                          --------------  ------------
Unrealized foreign currency translation gains:                              
Balance at beginning of year                     174,091       123,294
Change in unrealized translation gains                                
 during year                                      39,215        51,858
                                          --------------  ------------
Balance at end of period                         213,306       175,152
                                          --------------  ------------
Unrealized gains on securities                                              
available for sale:                                                       
Balance at beginning of year                     228,844        14,811
Change in unrealized gains (losses)                                   
  during year, net of income taxes                242,657      (205,409)
Cumulative effect of accounting change,                               
adopted January 1, 1994 (SFAS 115),                                 
 net of income taxes                                   -       461,478
                                          --------------  ------------
Balance at end of period                         471,501       270,880
                                          --------------  ------------
Retained earnings:                                                          
Balance at beginning of year                   1,277,487     1,029,625
Net earnings                                     265,749       215,394
Cash dividends on common stock                                        
($.375 per share in 1995, $.33 per                              
    share in 1994)                                (36,619)      (33,487)
                                          --------------  ------------
Balance at end of period                       1,506,617     1,211,532
                                          --------------  ------------
Treasury stock:                                                             
 Balance at beginning of year                    (135,776)       (6,568)
Purchases of treasury stock (5,215 shares                             
  in 1995 and 3,819 shares in 1994)              (213,186)     (119,009)
Shares issued to sales associates stock plan       7,013           938
                                          --------------  ------------
 Balance at end of period                        (341,949)     (124,639)
                                          --------------  ------------
Notes receivable for stock purchases                 (1,112)       (1,401)  
                                          --------------  ------------
Total shareholders' equity               $     2,060,182 $   1,739,081
                                          ==============  ============
See accompanying Notes to Consolidated Financial Statements.                    
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AFLAC INCORPORATED AND SUBSIDIARIES 
Consolidated Statements of Cash Flows 
(In thousands - Unaudited)  

                                       Nine Months Ended
                                       September 30,
                                         -----------------------------
                                           1995             1994
                                         ------------     ------------

Cash flows from operating activities:                                           
Net earnings                               $   265,749      $   215,394   
Adjustments to reconcile net earnings to                                  
net cash provided by operating activities:                              
Increase in policy liabilities            1,964,745        1,615,173
Deferred income taxes                        44,455           57,473
 Decrease in income taxes payable             (5,862)         (47,703)
Increase in deferred policy                                         
    acquisition costs                       (188,326)        (196,507)
 Increase in receivables                     (26,572)         (42,833)
Other, net                                  107,292          116,052
                                         ------------     ------------
Net cash provided by operating                                
      activities                          2,161,481        1,717,049
                                         ------------     ------------

Cash flows from investing activities:                                           
Proceeds from investments sold or matured:                                
Fixed-maturity securities matured                                   
   or called                                451,706           61,303
Fixed-maturity securities sold              515,920          788,222
Equity securities                            17,978           37,676
Mortgage loans, net                           3,683           34,288
Other long-term, net                            173                -
Costs of investments acquired:                                            
 Fixed-maturity securities                (2,881,037)      (2,204,738)
 Equity securities                           (24,038)         (30,525)
 Other long-term, net                              -           (3,078)
 Short-term, net                            (174,312)        (127,824)
Additions to property and equipment, net       (13,080)        (183,152)  
                                         ------------     ------------
Net cash used by investing                                    
     activities                           (2,103,007)      (1,627,828)
                                         ------------     ------------

See accompanying Notes to Consolidated Financial Statements.                    

(continued)                                                                     

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AFLAC INCORPORATED AND SUBSIDIARIES 
Consolidated Statements of Cash Flows (continued) 
(In thousands - Unaudited)

                                         Nine Months Ended
                                         September 30,
                                         -----------------------------
                                           1995             1994
                                         ------------     ------------

Cash flows from financing activities:                                           
Proceeds from borrowings                       209,250           83,000   
Principal payments under debt obligations      (27,053)         (12,384)  
Dividends paid to shareholders                 (36,618)         (33,487)  
Purchases of treasury stock                   (213,186)        (119,009)  
Treasury stock reissued                          7,999            1,056   
Other, net                                       2,334            1,338   
                                         ------------     ------------
Net cash used by financing                                    
       activities                            (57,274)         (79,486)
                                         ------------     ------------
Effect of exchange rate changes on cash              (783)           3,714      
                                         ------------     ------------
   Net change in cash                           417           13,449
Cash at beginning of year                          17,643           23,413      
                                         ------------     ------------
Cash at end of period                         $    18,060      $    36,862      
                                         ============     ============

Supplemental disclosures of cash flow information:                              
Cash payments during the year for:                                        
Interest on debt obligations             $    10,080      $     8,630 
Income taxes                                 153,381          145,932 

Non-cash financing activities included capital lease obligations incurred 
for computer equipment totaling $2,585 in 1995 and $13,594 in 1994.       

See accompanying Notes to Consolidated Financial Statements.                    

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AFLAC INCORPORATED AND SUBSIDIARIES       
Notes to Consolidated Financial Statements        

1.   In the opinion of management, the accompanying unaudited consolidated      
financial statements of AFLAC Incorporated and subsidiaries (the "Company")     
contain all adjustments (none of which were other than normal recurring         
accruals) necessary to fairly present the financial position as of September    
30, 1995, and the results of operations for the three-month and nine-month      
periods ended September 30, 1995 and 1994, and changes in shareholders'         
equity and cash flows for the nine months ended September 30, 1995 and 1994.    
Results of operations for interim periods are not necessarily indicative of     
results for the entire year.  The financial statements should be read in        
conjunction with the financial statements included in the Company's annual      
report to shareholders for the year ended December 31, 1994.                    

2.   In August 1995, the Company's board of directors authorized the            
purchase of up to an additional 5.0 million shares of the Company's common      
stock.  In total, the board of directors has authorized the purchase of up      
to 14.2 million shares since the initiation of the repurchase program in        
February 1994. There were 5.2 million shares and 3.8 million shares             
purchased during the nine months ended September 30, 1995 and 1994,             
respectively.  Through September 30, 1995, a total of 9.4 million shares had    
been purchased under the repurchase authorizations.  At September 30, 1995,     
9.4 million shares were held in the treasury at a cost of $341.9 million.       

 The shares purchased during the first nine months of 1995 were financed
with available cash and borrowings under revolving credit and term note         
agreements.  The loan agreements were amended during 1995 to provide for        
borrowings up to $250 million in either U.S. dollars with interest at LIBOR     
plus 27.5 basis points or Japanese yen with interest at the Tokyo Interbank     
Offered Rate (TIBOR) plus 27.5 basis points.  Principal payments are payable    
over five years beginning in June 1996.  The loan agreement contains various    
covenants, one of which requires the Company to maintain a minimum              
consolidated shareholders' equity of $1.0 billion.                              

In August 1995, all outstanding borrowings under the agreement were   
converted from dollar-denominated to yen-denominated loans.  At September       
30, 1995, bank borrowings of 23.9 billion yen ($239.3 million) were             
outstanding in connection with the share purchase program.  Interest expense    
related to the share repurchase program for the nine months ended September     
30, 1995 and 1994 was $4.3 million and $1.8 million, respectively.              

 The Company has designated the yen-denominated borrowings as a hedge of
its net investment in AFLAC Japan.  Foreign currency translation                
gains/losses are included in the unrealized foreign currency translation        
gains component in shareholders' equity.  Outstanding principal and related     
accrued interest payable on the yen-denominated borrowings were translated      
into dollars at the spot exchange rates as of September 30, 1995. Interest      
expense was translated at average exchange rates for the period the             
borrowings were outstanding in 1995.                                            

In August 1995, the Company entered into interest rate swap agreements
to reduce the impact of changes in interest rates on this floating-rate         
long-term debt.  The swaps have notional principal amounts which approximate    
the unpaid principal amount during the six-year loan period.  Under these       
agreements, the Company makes fixed-rate interest payments at 2.46% and         

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receives floating-rate payments in return.  As of September 30, 1995, the       
floating rate based on three-month TIBOR was .92%.  These transactions          
effectively change a portion of the Company's interest rate exposure from a     
floating rate to a fixed rate of 2.74% (including 27.5 basis point loan         
margin).                                                                        

3.   Effective January 1, 1994, the Company adopted SFAS No. 115, Accounting    
for Certain Investments in Debt and Equity Securities.  Under this standard,    
the Company classifies all fixed-maturity securities as "available for          
sale."  Such securities are carried at fair value rather than amortized         
cost.  The related unrealized gains and losses, less amounts applicable to      
policy liabilities and deferred income taxes, are reported in a separate        
component of shareholders' equity together with unrealized gains and losses     
on equity securities.  This change in accounting method has no effect on net    
earnings.                                                                       

The effect of this accounting change on shareholders' equity was as   
follows:                                                                        

(In thousands)      September 30, 1995  December 31, 1994  January 1, 1994  
                  ------------------  -----------------  ---------------
Investments             $  2,792,168        $    820,874      $   1,851,141     
Policy liabilities        (2,034,172)           (315,599)        (1,088,633)    
Deferred income taxes       (312,095)           (289,089)          (301,030)    
                   ------------        ------------      -------------
Shareholders' equity,                                                           
net unrealized gains                                                          
on securities                                                                 
available for sale     $    445,901        $    216,186      $     461,478    
                   ============        ============      =============

The portion of unrealized gains credited to policy liabilities        
represents gains that would not inure to the benefit of the shareholders if     
such gains were actually realized.  These amounts are necessary to cover        
policy reserve interest requirements based on market investment yields at       
these dates.                                                                    

4.  AFLAC Japan uses short-term security lending arrangements to increase       
investment income with minimal risk.  Fixed-maturity securities owned by        
AFLAC Japan are loaned to major securities firms.  At September 30, 1995,       
the Company held Japanese government bonds as collateral for loaned             
securities in the amount of $1.0 billion at market value.  The Company's        
security lending policy requires that the fair value of the securities          
received as collateral be greater than or equal to 105% of the fair value of    
the loaned securities as of the date the securities are loaned and not less     
than 100% thereafter.  Bond market quotations are used to determine the fair    
value (carrying value) of the collateral asset and related liability.           

5.  The Company is a defendant in various litigation considered to be in the    
normal course of business.  Some of this litigation is pending in Alabama       
where large punitive damage awards bearing little relation to the actual        
damages sustained by plaintiffs have been awarded against companies,            
including other insurers, in recent years.  During the quarter, the Company     
settled certain litigation in Alabama related to an ancillary line of           
business.  However, the settlement was not material to the Company's            
consolidated net earnings for the nine months ended September 30, 1995.         
Although the final results of any litigation cannot be predicted with           

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certainty, the Company does not believe the outcome of any litigation still     
pending will have a material adverse effect on the financial position of the    
Company.                                                                        

The Internal Revenue Service has proposed adjustments to the Company's
U.S. consolidated federal income tax returns for the years 1989 through         
1991. The proposed adjustments relate primarily to the computation of           
foreign source income for purposes of the foreign tax credit that, if           
upheld, would have a significant effect on the Company's operating results.     
Management does not agree with the proposed tax issues and is vigorously        
contesting them.  The final outcome is still undetermined.  However, the        
Company believes its position will prevail and that the ultimate liability      
will not materially impact the consolidated financial statements.               

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REVIEW BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS    

The September 30, 1995 and 1994 financial statements included in this 
filing have been reviewed by KPMG Peat Marwick LLP, independent certified       
public accountants, in accordance with established professional standards       
and procedures for such a review.                                               

The report of KPMG Peat Marwick LLP commenting upon their review is   
included on page 11.                                                            

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KPMG PEAT MARWICK LLP                                                           
Certified Public Accountants                                                    
303 Peachtree Street, N.E.                       Telephone: (404) 222-3000      
Suite 2000                                       Telefax:   (404) 222-3050      
Atlanta, GA 30308                                                               

INDEPENDENT AUDITORS' REPORT

The Shareholders and Board of Directors                                         
AFLAC Incorporated:                                                             

We have reviewed the accompanying consolidated balance sheet of AFLAC           
Incorporated and subsidiaries as of September 30, 1995, and the related         
consolidated statements of earnings for the three-month and nine-month          
periods ended September 30, 1995 and 1994, and the consolidated statements      
of cash flows and shareholders' equity for the nine-month periods ended         
September 30, 1995 and 1994.  These consolidated financial statements are       
the responsibility of the Company's management.                                 

We conducted our review in accordance with standards established by the         
American Institute of Certified Public Accountants.  A review of interim        
financial information consists principally of applying analytical procedures    
to financial data and making inquiries of persons responsible for financial     
and accounting matters.  It is substantially less in scope than an audit        
conducted in accordance with generally accepted auditing standards, the         
objective of which is the expression of any opinion regarding the financial     
statements taken as a whole.  Accordingly, we do not express such an            
opinion.                                                                        

Based on our review, we are not aware of any material modifications that        
should be made to the consolidated financial statements referred to above       
for them to be in conformity with generally accepted accounting principles.     

We have previously audited, in accordance with generally accepted auditing      
standards, the accompanying consolidated balance sheet of AFLAC Incorporated    
and subsidiaries as of December 31, 1994, and the related consolidated          
statements of earnings, shareholders' equity and cash flows for the year        
then ended (not presented herein); and in our report dated January 30, 1995,    
we expressed an unqualified opinion on those consolidated financial             
statements.                                                                     

                                         KPMG PEAT MARWICK LLP

October 25, 1995                                                                

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL                    
CONDITION AND RESULTS OF OPERATIONS                       

The primary business activity of AFLAC Incorporated and subsidiaries  
(the "Company") is supplemental health insurance, which is marketed and         
administered primarily through American Family Life Assurance Company of        
Columbus (AFLAC).  The Company's operations in Japan (AFLAC Japan) and the      
United States (AFLAC U.S.) service the two principal markets for the            
Company's insurance operations.  AFLAC Japan and AFLAC U.S. are the primary     
components for this discussion and analysis, due to their significance to       
the Company's consolidated financial condition and results of operations.       

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RESULTS OF OPERATIONS                                                                                                       

     The following table sets forth the pretax operating earnings by business component for the periods shown and the       
percentage change from the prior period.                                                                                    
                                        SUMMARY OF OPERATING RESULTS BY BUSINESS COMPONENT                                  
                                           (In millions, except for per-share amounts)                                      

                                            Three Months Ended September 30,             Nine Months Ended September 30,    
                                         --------------------------------------      -------------------------------------- 
                                         Percentage Change                           Percentage Change                      
                                           Over Previous                               Over Previous                        
                                              Period           1995      1994             Period           1995      1994   
                                         -----------------   ------------------      -----------------   ------------------ 
                                                                                                                            
Insurance operations (excluding                                                                                             
 realized investment gains and losses):                                                                                     

  AFLAC Japan........................          14.6%         $ 140.0    $ 122.2             22.0%        $ 425.8    $ 349.1 

  AFLAC U.S..........................           2.8             24.3       23.6             15.0            75.5       65.6 

  Other foreign......................                            (.5)       (.1)                             (.6)      (1.2)
                                                              ------     ------                           ------     ------ 
   Total insurance...................          12.4            163.8      145.7             21.1           500.7      413.5 

Realized investment gains (losses)...                            (.1)       (.2)                              .1        (.3)

Broadcast division...................          11.7              4.4        3.9             12.7            14.8       13.1 

Interest expense,                                                                                                           
 noninsurance operations.............                           (3.1)      (2.9)                            (9.0)      (7.4)

Capitalized interest,                                                                                                       
 building construction...............                              -          -                                -        2.4 

Parent company, other operations                                                                                            
 and eliminations....................          21.9            (13.3)     (17.0)              .7           (49.0)     (49.3)
                                                              ------     ------                           ------     ------ 
   Earnings before income taxes......          17.2            151.7      129.5             23.0           457.6      372.0 

Income taxes.........................                           63.7       53.4                            191.9      156.6 
                                                              ------     ------                           ------     ------ 
   Net earnings......................          15.6          $  88.0    $  76.1             23.4         $ 265.7    $ 215.4 
                                                              ======     ======                           ======     ====== 
   Net earnings per share............          20.3          $   .89    $   .74             26.9         $  2.64    $  2.08 
                                                              ======     ======                           ======     ====== 
                                                                13                                                          

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Net earnings increased 15.6% for the three months ended September 30, 
1995, and 23.4% for the nine months ended September 30, 1995, compared with     
the respective periods in 1994.  The increases primarily resulted from          
strong earnings from our core insurance operations in Japan and the United      
States and improved results by the Broadcast Division.  Partially offsetting    
the increases was additional interest expense primarily related to the          
Company's stock repurchase program. Also partially offsetting the increase      
for the nine months was the absence of capitalized interest in 1995 due to      
completion of the Company's administrative office building in Japan in early    
1994.                                                                           

The increases in reported results in U.S. dollars for AFLAC Japan and 
consolidated earnings for both the three months and nine months ended           
September 30, 1995, were aided by favorable currency translations from yen      
to dollars.  Following the dramatic rise in the value of the Japanese yen in    
relation to the U.S. dollar during the second quarter of this year, the yen     
began to weaken in the third quarter.  However, the yen was still stronger      
in the third quarter compared with the same period a year ago, which            
resulted in a benefit to operating earnings per share. The strengthening of     
the yen benefited operating earnings (excluding realized investment             
gains/losses) by approximately $.03 per share for the three months ended        
September 30, 1995, and $.24 per share for the nine months ended September      
30, 1995.  Excluding the benefit of the stronger yen, operating earnings per    
share increased 16.2% for the three months ended September 30, 1995, and        
increased 15.4% for the nine months ended September 30, 1995, compared with     
the respective periods in 1994.                                                 

AFLAC Japan's pretax operating earnings (excluding realized investment
gains/losses) in yen increased 8.6% for the three months ended September 30,    
1995, compared with the third quarter of 1994, and increased 8.2% for the       
nine months ended September 30, 1995, compared with the nine months ended       
September 30, 1994. The reported U.S. dollar results for AFLAC Japan were       
affected by the favorable average yen-to-dollar exchange rate of 91.62 for      
the nine months ended September 30, 1995, compared with 103.39 for the first    
nine months of 1994.  As a result, percentage increases in U.S. dollars for     
AFLAC Japan's pretax operating earnings were 14.6% for the three months         
ended September 30, 1995, compared with the third quarter of 1994, and 22.0%    
for the nine months ended September 30, 1995, compared with the nine months     
ended September 30, 1994.                                                       

AFLAC Japan repatriated profits to AFLAC U.S. of $140.5 million in    
1995, $132.9 million in 1994, and $97.9 million in 1993.  The profit            
transfers to AFLAC U.S. adversely impact AFLAC Japan's investment income.       
However, repatriations benefit consolidated operations because higher           
investment yields can be earned on funds invested in the United States.         
Also, income tax expense is presently lower on investment income earned in      
the United States.  Management estimates profit transfers from 1992 through     
1995 have benefited consolidated net earnings by $5.0 million and $2.6          
million for the three months ended September 30, 1995 and 1994,                 
respectively, and $9.2 million and $4.7 million for the nine months ended       
September 30, 1995 and 1994, respectively.                                      

During the third quarter, AFLAC purchased 2.9 million shares of its   
common stock.  The Company has bought a total of 9.4 million shares (through    
September 30, 1995) since the inception of the share repurchase program in      
February 1994.  The spread in percentage points between the increases in net    
earnings and net earnings per share primarily reflects the impact of the        
share repurchase program.                                                       
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AFLAC JAPAN                                                                     

AFLAC Japan, a branch of AFLAC and the principal contributor to the   
Company's earnings, is the fourth largest life insurance company in Japan in    
terms of individual policies in force.                                          

The transfer of profits from 1992 through 1995 from AFLAC Japan to AFLAC    
U.S. distorted comparisons of operating results between periods.  The           
following AFLAC Japan summary of operations tables present investment           
income, total revenues and pretax operating earnings calculated on a pro        
forma basis in order to improve comparability between periods.  The pro         
forma adjustment represents cumulative investment income foregone by AFLAC      
Japan on funds repatriated to AFLAC U.S. during 1992 through 1995.              

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AFLAC JAPAN       
SUMMARY OF OPERATING RESULTS    
THREE MONTHS ENDED SEPTEMBER 30,    

                                    In Dollars
(In millions)                                   1995            1994            
                                    --------------------------
Premium income......................         $ 1,310.4       $ 1,158.6          
Investment income, as adjusted*.....             237.7           198.8          
Other income........................              (1.6)             .5          
                                   ---------       ---------
Total revenues, as adjusted*......           1,546.5         1,357.9        
                                   ---------       ---------
Benefits and claims.................           1,134.2           994.3          
Operating expenses..................             266.4           237.3          
                                   ---------       ---------
Total benefits and expenses.......           1,400.6         1,231.6        
                                   ---------       ---------
Pretax operating earnings,                                              
as adjusted*...................             145.9           126.3     
Investment income applicable to                                                 
profit repatriations...............              (5.9)           (4.1)        
                                   ---------       ---------
Pretax operating earnings.......         $   140.0       $   122.2      
                                   =========       =========
----------------------------------------------------------------------------    
                      In Dollars              In Yen
                        1995      1994        1995      1994
                        ----------------      ----------------
Percentage increases                                                            
over previous period:                                                         
Premium income..............    13.1%     26.1%        6.9%     18.1%       
Investment income*..........    19.6      20.5        13.1      12.8        
Total revenues*.............    13.9      25.3         7.6      17.3        
Pretax operating earnings*..    15.5      19.3         9.4      11.8        

Pretax operating earnings...    14.6      17.8         8.6      10.4        
----------------------------------------------------------------------------    
                          In Dollars
                          1995        1994
                          ------------------
Ratios to total revenues, as adjusted:*                                         
Benefits and claims................        73.4%       73.2%                
Operating expenses.................        17.2        17.5                 
Pretax operating earnings..........         9.4         9.3                 

Ratio of pretax operating earnings                                              
to total reported revenues.........         9.1         9.0                 
----------------------------------------------------------------------------    
*Adjusted investment income, total revenues and pretax operating earnings       
include estimates of additional investment income of $5.9 million in 1995       
and $4.1 million in 1994, foregone due to profit repatriations.                 
============================================================================    

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AFLAC JAPAN       
SUMMARY OF OPERATING RESULTS    
NINE MONTHS ENDED SEPTEMBER 30,   

                                    In Dollars
(In millions)                                   1995            1994            
                                    --------------------------
Premium income......................         $ 3,966.5       $ 3,194.4          
Investment income, as adjusted*.....             711.3           558.6          
Other income........................                .1             2.2          
                                   ---------       ---------
Total revenues, as adjusted*......           4,677.9         3,755.2        
                                   ---------       ---------
Benefits and claims.................           3,426.0         2,732.7          
Operating expenses..................             811.0           665.1          
                                   ---------       ---------
Total benefits and expenses.......           4,237.0         3,397.8        
                                   ---------       ---------
Pretax operating earnings,                                              
as adjusted*...................             440.9           357.4     
Investment income applicable to                                                 
profit repatriations...............             (15.1)           (8.3)        
                                   ---------       ---------
Pretax operating earnings.......         $   425.8       $   349.1      
                                   =========       =========
----------------------------------------------------------------------------    
                      In Dollars              In Yen
                        1995      1994        1995      1994
                        ----------------      ----------------
Percentage increases                                                            
over previous period:                                                         
Premium income..............   24.2%     25.3%       10.0%     15.4%        
Investment income*..........   27.3      22.9        12.9      13.2         
Total revenues*.............   24.6      24.9        10.4      15.1         
Pretax operating earnings*..   23.3      20.4         9.4      10.9         

Pretax operating earnings...   22.0      18.8         8.2       9.4         
----------------------------------------------------------------------------    
                          In Dollars
                          1995        1994
                          ------------------
Ratios to total revenues, as adjusted:*                                         
Benefits and claims................        73.3%       72.8%                
Operating expenses.................        17.3        17.7                 
Pretax operating earnings..........         9.4         9.5                 

Ratio of pretax operating earnings                                              
to total reported revenues.........         9.1         9.3                 
----------------------------------------------------------------------------    
*Adjusted investment income, total revenues and pretax operating earnings       
include estimates of additional investment income of $15.1 million in 1995      
and $8.3 million in 1994, foregone due to profit repatriations.                 
============================================================================    

The yen began to weaken in the third quarter compared with the second 
quarter of 1995.  However, the yen was still stronger in the first nine         
months of 1995 compared with the first nine months of 1994.  The average        

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exchange rate for the first nine months of 1995 was 91.62, which was 12.8%      
stronger than the average rate of 103.39 for the first nine months of 1994.     
As a result, growth rates for AFLAC Japan continued to be higher in dollars     
than in yen.  The average exchange rate for the full year 1994 was 102.26.      

The increase in premium income was due to: sales of new policies; the 
conversion of existing policies to policies with higher benefits and            
premiums; continued excellent policy persistency; and, in dollars, the          
stronger yen rate.  The single-digit increases in premium income and total      
revenues for the third quarter reflect a moderation in sales following          
exceptionally strong sales in the first half of 1994.  As expected, new         
annualized premium sales, excluding conversions, were down in the quarter,      
declining 9.2% in yen.  For the nine months, new annualized premium sales       
increased 5.9% in yen.  Sales in the first half of 1994 were exceptionally      
strong due to the agents' heightened efforts to sell the Company's cancer       
policy before a July 1994 rate increase on new issues.  Sales for the first     
half of 1994, including conversions, increased 30.6% in yen compared with       
the first half of 1993.  Sales leveled out in the second half of 1994 and       
increased 10%, including conversions, for the year compared with the year       
1993.  Management's goal is to increase new sales, excluding conversions, by    
10% in yen for the year 1995.                                                   

Although Japan's economy remains soft, the Company's lower third      
quarter sales results primarily reflect the decision to defer various major     
sales campaigns to accommodate the introduction of AFLAC Japan's new product    
- living benefit life.  Many agencies that serve large payroll accounts have    
planned extensive sales campaigns in the fourth quarter of this year to         
promote this new product.  In fact, agencies have requested more than six       
million pre-printed application forms for the living benefit life rider to      
the cancer policy for use in their sales campaigns to new and existing          
customers.                                                                      

Investment income, which is affected by available cash flow from      
operations and investment yields available for new investments, increased       
during both the three months and nine months ended September 30, 1995,          
compared with the respective periods of 1994, despite investment yields that    
have generally declined.                                                        

Rates of return on fixed-income securities in Japan have remained low 
in 1995 compared with historical levels.  For instance, the yield on 10-year    
Japanese government bonds, as measured by a composite index, has declined       
from 4.72% in January to a low of 2.60% in July, reaching 3.39% in August       
and closing the quarter at 2.86%.                                               

By concentrating on selected sectors, the Company has secured higher  
yields than 10-year government bonds would have provided.  At the same time,    
the Company has adhered to its conservative standards for credit quality.       
The Company purchased yen-denominated securities at an average yield to         
maturity of 4.73% for the third quarter and 4.61% for the nine months.          
Including investments in dollar-denominated securities, the blended new         
money yield to maturity was 5.01% for the quarter and 4.97% for the nine        
months.  As a result of the continued low level of investment yields, the       
yield to maturity on AFLAC Japan's fixed-income portfolio declined from         
6.00% at the end of the second quarter to 5.98% at the end of the third         
quarter.  The return on AFLAC Japan's average invested assets was 5.83% for     
the nine months, compared with 6.01% for the same period in 1994.  AFLAC        
Japan has significant cash flows -- averaging more than $250 million per        

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month this year -- to invest.  However, it is difficult to find attractive      
investment yields in yen-denominated securities for these cash flows in the     
current interest rate environment.                                              

AFLAC Japan's results continue to reflect the pattern that has        
developed during the last several years of slightly higher benefit ratios       
somewhat offset by lower expense ratios.  The increase in the benefit ratio     
reflects the strengthening of policy liabilities to provide for lower           
assumed interest rates and the increase in claims experience due to fewer       
policy lapses.                                                                  

AFLAC U.S.                                                                      

AFLAC U.S. produced good results in the third quarter, although pretax
operating earnings were impacted by the decision to settle certain              
litigation in Alabama related to an ancillary line of business.  Earnings       
benefited from additional investment income earned on profit transfers          
received from AFLAC Japan.  AFLAC U.S. in turn made additional dividend         
payments to the Parent Company in the amounts of $16.0 million in the first     
nine months of 1995, and $51.9 million and $10.1 million for the full years     
1994 and 1993, respectively.  Estimated investment income earned from           
profits repatriated to and retained by AFLAC U.S. from 1992 through 1995 has    
been reclassified in the following presentation in order to improve             
comparability between periods.                                                  

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  AFLAC U.S.
  SUMMARY OF OPERATING RESULTS

                                Three Months Ended     Nine Months Ended
                                  September 30,          September 30,
(In millions)                         1995     1994          1995     1994    
                                ------------------     -----------------
Premium income...................   $ 217.0   $ 199.4      $ 638.5   $ 588.7    
Investment income, as adjusted*..      19.7      17.3         57.7      50.7    
Other income.....................       (.2)       .5           .4       2.1    
                                 ------    ------       ------    ------
Total revenues, as adjusted*...     236.5     217.2        696.6     641.5  
                                 ------    ------       ------    ------
Benefits and claims..............     133.3     122.0        395.2     366.1    
Operating expenses...............      85.3      75.8        240.5     218.5    
                                 ------    ------       ------    ------
Total benefits and expenses....     218.6     197.8        635.7     584.6  
                                 ------    ------       ------    ------
Pretax operating earnings,                                              
 as adjusted*................      17.9      19.4         60.9      56.9
Investment income applicable to                                                 
profit repatriations............       6.4       4.2         14.6       8.7   
                                 ------    ------       ------    ------
Pretax operating earnings....   $  24.3   $  23.6      $  75.5   $  65.6
                                 ======    ======       ======    ======
----------------------------------------------------------------------------    
Percentage increases                                                            
over previous period:                                                         
Premium income.................      8.9%      8.8%         8.5%      9.8%  
Investment income*.............     13.6      10.5         13.9       9.5   
Total revenues*................      8.9       8.8          8.6       9.7   
Pretax operating earnings*.....     (7.7)     11.3          7.0      11.7   

Pretax operating earnings......      2.8      19.1         15.0      19.9   
----------------------------------------------------------------------------    
Ratios to total revenues,                                                       
as adjusted:*                                                                 
Benefits and claims............     56.3%     56.2%        56.8%     57.0%  
Operating expenses.............     36.1      34.9         34.5      34.1   
Pretax operating earnings......      7.6       8.9          8.7       8.9   

Ratio of pretax operating earnings                                              
to total reported revenues......     10.3      10.9         10.8      10.2    
----------------------------------------------------------------------------    
*Excludes estimated investment income for the three months ended September      
30, 1995 and 1994 of $6.4 million and $4.2 million, respectively, and for       
the nine months ended September 30, 1995 and 1994 of $14.6 million and $8.7     
million, respectively, related to investment of profit repatriation funds       
retained by AFLAC U.S.                                                          
============================================================================    

Benefit ratios have been slightly lower, which is principally due to  
the mix of business shifting towards accident policies.  Accident policies      
have a lower benefit ratio compared with other products.  Management expects    
future benefit ratios for some of the Company's supplemental products to        
increase slightly due to the Company's ongoing efforts to enhance               

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policyholder benefits.  In addition, potential minimum benefit ratio            
requirements by insurance regulators may also increase the ratio.               

At the same time, management expects the operating expense ratio,     
excluding discretionary advertising, to decline in the future due to            
continued improvement in operating efficiencies. By improving administrative    
systems and controlling other costs, management has been able to redirect       
funds to discretionary national advertising programs without significantly      
affecting the operating expense ratio.  The Company's advertising expense       
was $11.3 million and $10.1 million for the nine months ended September 30,     
1995 and 1994, respectively, or 1.6% of revenues in both 1995 and 1994.         
Management expects the pretax operating profit margin, which was 9.0% for       
the year 1994 excluding the effect of repatriation, to remain approximately     
the same for the year 1995.                                                     

 The increase in premium income was due to an increase in new sales over
the last 12 months and some improvement in persistency for several of the       
product lines.  Total new annualized premium sales continued to grow at a       
solid rate, increasing 16.5% for the third quarter.  Total new sales of         
$72.2 million for the three-month period set a quarterly record for             
production.  For the nine months, total new sales rose 13.4% to $204.8          
million.  New products again contributed greatly to new sales growth.  At       
the same time, the Company continued to experience declines in Medicare         
supplement sales, the lowest-margin product, due to a de-emphasis of this       
product.  Excluding Medicare supplement sales, new annualized premium sales     
were up 22.1% for the third quarter and 20.3% for the nine months.              

The increase in investment income was primarily due to profit         
repatriations from AFLAC Japan and the continued strong cash flow from          
operations. During the third quarter, available cash flow was invested at an    
average yield-to-maturity of 7.50%, compared with 7.96% during the third        
quarter of 1994.  The overall return on average invested assets, net of         
investment expenses, was 7.33% for the first nine months of 1995 versus         
7.46% for the first nine months of 1994.                                        

FINANCIAL ACCOUNTING STANDARDS BOARD'S STATEMENTS                               

On January 1, 1995, the Company adopted Statement of Financial        
Accounting Standards (SFAS) No. 114, Accounting by Creditors for Impairment     
of a Loan, and SFAS No. 118, Accounting by Creditors for Impairment of a        
Loan-Income Recognition and Disclosures.  SFAS No. 114 requires impaired        
mortgage loans to be measured based on the present value of expected future     
cash flows, discounted at the loan's effective interest rate, or at the         
loan's observable market price, or the fair value of the collateral if the      
loan is collateral dependent.  SFAS No. 118 eliminates certain income           
recognition provisions previously included in SFAS No. 114.  The                
implementation of these standards had no material effect on the Company.        

In March 1995, the FASB issued SFAS 121, Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed Of.  This         
statement establishes accounting standards for: 1) the impairment of long-      
lived assets, certain identifiable intangibles, and goodwill related to         
those assets to be held and used in the business; and 2) long-lived assets      
and certain identifiable intangibles to be disposed of.  This standard,         
which must be adopted by March 31, 1996, will require the Company to report     
certain investment real estate at fair value, rather than at net realizable     

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value as previously required.  The Company does not anticipate a material       
effect on net income, liquidity or capital related to adoption of this          
standard.                                                                       

ANALYSIS OF FINANCIAL CONDITION                                                 

Since December 31, 1994, the financial condition of the Company has   
remained strong.  Investments have continued to grow and consist of             
high-quality securities.                                                        

Due to the relative size of AFLAC Japan, changes in the yen/dollar    
exchange rate can have a significant effect on the Company's financial          
statements.  The yen/dollar exchange rate at the end of each period is used     
to convert yen-denominated balance sheet items into U.S. dollars for            
reporting purposes.  The exchange rate at September 30, 1995, was 99.10 yen     
to one U.S. dollar, which was almost the same as the December 31, 1994, rate    
of 99.85.  The small difference in the rates had little effect on the           
comparison of the September 30, 1995, balance sheet with the December 31,       
1994, balance sheet.  During the first nine months, the exchange rate ranged    
between 80.20 and 104.50.                                                       

Under the provisions of SFAS No. 115 adopted January 1, 1994, fixed-  
maturity securities available for sale are carried at fair value.               
Previously, fixed-maturity securities were carried at amortized cost.  Since    
December 31, 1994, total invested assets, including the effect of SFAS No.      
115, have increased $4.0 billion, or 25.2%.  AFLAC Japan invested assets        
increased $3.7 billion (24.8%), while AFLAC U.S. invested assets increased      
$353.9 million (28.2%).  Since December 31, 1994, total invested assets,        
excluding the effect of SFAS No. 115, have increased $2.1 billion, or 13.6%.    
AFLAC Japan invested assets increased $1.8 billion (12.9%), while AFLAC U.S.    
invested assets increased $252.7 million (19.4%). The continued growth in       
assets reflects the substantial cash flows from new annualized premium sales    
by AFLAC U.S. and renewal premiums collected by AFLAC Japan.                    

The net unrealized gains of $2.8 billion on investments in fixed-     
maturity securities at September 30, 1995, consisted of $2.8 billion in         
gross unrealized gains and $16.1 million in gross unrealized losses.  During    
1995, net unrealized gains increased by $2.0 billion, which was primarily       
due to the decrease in general-market interest rates in Japan and the United    
States.  AFLAC Japan net unrealized gains increased $1.9 billion, and AFLAC     
U.S. net unrealized gains increased $101.1 million since December 31, 1994.     

Policy liabilities increased $3.7 billion, or 23.0%, during the first 
nine months of 1995.  AFLAC Japan increased $3.6 billion, or 24.6% (23.7% in    
yen), and AFLAC U.S. increased $96.0 million, or 6.9%. The increases in         
policy liabilities are due to the addition of new business, the aging of        
policies in force and the effect of SFAS No. 115.  See Note 3 of the Notes      
to the Consolidated Financial Statements.                                       

Notes payable has increased $167.5 million, or 90.6%, since December  
31, 1994.  This increase is primarily related to stock repurchase activity.     
For further information regarding notes payable, see Note 2 of the Notes to     
the Consolidated Financial Statements.                                          

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Shareholders' equity increased $308.4 million during the first nine   
months of 1995.  The increase is due to: net earnings of $265.7 million, an     
increase in net unrealized gains on securities available for sale of $242.7     
million, an increase in unrealized foreign exchange translation gains of        
$39.2 million, less treasury stock purchases of $213.2 million and dividends    
paid of $36.6 million.                                                          

    The Company's insurance operations continue to provide the primary sources
of liquidity for the Company.  Capital needs can also be supplemented by        
borrowed funds.  The principal sources of cash from insurance operations are    
premiums and investment income.  The primary uses of cash in the insurance      
operations are policy claims, commissions, operating expenses, income taxes and 
payments to the Parent Company for management fees and dividends.  Both the     
sources and uses of cash are reasonably predictable.  The Company's investment  
objectives provide for liquidity through the ownership of high-quality          
investment securities.  AFLAC insurance policies are generally not              
interest-sensitive and therefore are not subject to unexpected policyholder     
redemptions due to investment yield changes.  Also, the majority of AFLAC       
policies provide indemnity benefits rather than reimbursement for actual        
medical costs and therefore are not subject to the risks of medical cost        
inflation.                                                                      

  The achievement of continued long-term growth will require growth in the
statutory capital and surplus of the Company's insurance subsidiaries.  The     
subsidiaries may secure additional statutory capital through various sources,   
such as internally generated statutory earnings or equity contributions by the  
Company from funds generated through debt or equity offerings.  Management      
believes outside sources for additional debt and equity capital, if needed,     
will continue to be available for capital expenditures and business expansion.  

    Parent Company capital resources are largely dependent upon the ability of
the subsidiaries to pay management fees and dividends.  The Georgia Insurance   
Department imposes certain limitations and restrictions on payments of          
dividends, management fees, loans and advances by AFLAC to the Parent Company.  
In addition to restrictions by U.S. insurance regulators, the Japanese Ministry 
of Finance (MOF) imposes restrictions on, and requires approval for, the        
remittances of earnings from AFLAC Japan to AFLAC U.S.  Annual payments are     
made from AFLAC Japan for management fees to the Parent Company, and for        
allocated expenses and remittances of earnings to AFLAC U.S.  Total funds       
received from AFLAC Japan were $168.9 million in the first nine months of       
1995 and $167.9 million and $133.4 million in the full years 1994 and 1993,     
respectively.  During the last two years, the MOF has developed solvency        
standards, a version of risk-based capital requirements, as part of its long-   
term deregulation process.  For additional information on regulatory            
restrictions on dividends, profit transfers and other remittances, see Note     
10 of the Notes to the Consolidated Financial Statements in the Company's       
annual report to shareholders for the year ended December 31, 1994.             

For information regarding proposed tax adjustments by the Internal    
Revenue Service and pending litigation, see Note 5 of the Notes to the          
Consolidated Financial Statements.                                              

The board of directors declared a fourth quarter cash dividend of $.13
per share.  The dividend is payable on December 1, 1995, to shareholders of     
record at the close of business on November 17, 1995.                           

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 PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS                                                      

 A number of civil jury verdicts involving insurance sales practices and
other matters have been returned against life and health insurers in the        
jurisdictions in which the Company does business in the United States.  Some    
of the lawsuits have resulted in the award of substantial judgments against     
the insurers, including material amounts of punitive damages.  In some          
states, juries have substantial discretion in awarding punitive damages in      
these circumstances.                                                            

The Company is a defendant in various litigation considered to be in  
the normal course of business.  Some of this litigation is pending in           
Alabama where large punitive damage awards bearing little relation to the       
actual damages sustained by plaintiffs have been awarded against companies,     
including other insurers, in recent years.  During the quarter, the Company     
settled certain litigation in Alabama related to an ancillary line of           
business.  However, the settlement was not material to the Company's            
consolidated net earnings for the nine months ended September 30, 1995.         
Although the final results of any litigation cannot be predicted with           
certainty, the Company does not believe the outcome of any  litigation still    
pending will have a material adverse effect on the financial position of the    
Company.                                                                        

ITEMS 2, 3, 4 and 5                                                             

Not applicable.                                                       

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K                                       

(a)  Exhibits:                                                        

  4.0 - The registrant is not filing one instrument evidencing
   indebtedness since the total amount of securities
       authorized does not exceed 10% of the total assets of
       the registrant and its subsidiaries on a consolidated
         basis.  Copies of such instruments will be furnished to
      the Securities and Exchange Commission upon request.

10   - AFLAC Incorporated Amended 1985 Stock Option Plan, as
amended August 8, 1995.                       

    10.1 - AFLAC Incorporated Employment Agreement with Paul S. Amos
dated August 1, 1995.                         

27   - Financial Data Schedule (for SEC use only)           

(b)  Reports on Form 8-K:                                             

    There were no reports on Form 8-K filed during the quarter ended
September 30, 1995.                                         

24  

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934,  
the registrant has duly caused this report to be signed on its behalf by the    
undersigned thereunto duly authorized.                                          

                          AFLAC INCORPORATED

Date:    November 8, 1995                    /s/ Kriss Cloninger, III           
 ------------------------               --------------------------------
                                  KRISS CLONINGER, III
                                   Executive Vice President;
                                 Treasurer and
                                   Chief Financial Officer

Date:    November 8, 1995                    /s/ Norman P. Foster               
 ------------------------               --------------------------------
                              NORMAN P. FOSTER
                                   Executive Vice President,
                               Corporate Finance

25  

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EXHIBITS FILED WITH CURRENT FORM 10-Q:                                          

10   - AFLAC Incorporated Amended 1985 Stock Option Plan, as amended  
August 8, 1995.                                         

 10.1 - AFLAC Incorporated Employment Agreement with Paul S. Amos, dated
August 1, 1995.                                         

27   - Financial Data Schedule (for SEC use only)                     

26

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘10-Q’ Filing	Date	First	Last	Other Filings

	3/31/96	21		10-Q
	12/1/95	23
	11/17/95	23
Filed on:	11/9/95
	11/8/95	25
	11/3/95	1
	10/25/95	12
For Period End:	9/30/95	1	24
	8/8/95	24	26
	8/1/95	24	26
	1/30/95	12
	1/1/95	21
	12/31/94	2	23	10-K405, 11-K
	9/30/94	2	21	10-Q
	1/1/94	5	22
				List all Filings

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Filing Submission 0000004977-95-000023 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Aflac Inc – ‘10-Q’ for 9/30/95

As of: Thursday, 11/9/95 · For: 9/30/95 · Accession #: 4977-95-23 · File #: 1-07434

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